London 2012 monitoring Nortel after bankruptcy

LONDON (AP) -- The future of a key sponsor of the 2012 London Olympics was in doubt Wednesday after Nortel Networks Corp. filed for bankruptcy protection in the United States and Canada amid the global economic downturn.

The Toronto-based technology giant signed up as one of London's domestic "tier-one" sponsors in July, committing to provide about $58 million in cash and the network infrastructure to operate communications with partner British Telecom.

Nortel, which is also a supplier for the 2010 Vancouver Winter Olympics along with Bell Canada, filed for court protection on Wednesday, a day before the firm is due to repay a $107 million interest debt on bonds.

Creditor protection would give the company more opportunities to explore restructuring options or sell off some of its assets.

"We are aware of the situation and working through it with Nortel," London 2012 organizers said in a statement.

Under the sponsorship deal, Nortel is to supply secure networks, local wireless networks, call center and fixed telephony infrastructure to support more than 205 international sporting organizations, 20,000 worldwide media, 9 million spectators and more than 4 billion television viewers of the London Games.

Officials are hopeful that Nortel can continue supporting the London Olympics in its existing capacity either by restructuring under Chapter 11 protection or by finding a buyer.

The news comes as London organizers secured another domestic sponsor by signing up Adecco to hire the staff needed to run the 2012 Olympics.

The world's biggest staffing agency will be responsible for doubling the work force of the organizing committee this year and for providing temporary staff required to run the Games.

Adecco joins candy company Cadbury and financial services firm Deloitte as tier-two sponsors, paying a minimum of $35 million to be associated with the Olympics.

"The quality of the people we hire will have a direct impact on the success of the games," London 2012 chairman Sebastian Coe said Wednesday.

Adecco was also a domestic sponsor at the 2000 Sydney Olympics and the 2006 Winter Olympics in Turin, Italy.

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